HP Convinces Self To Keep Selling PCs

Meg Whitman takes HP in yet another direction

HP will stay in the PC business.

After weeks of turmoil and seemingly haphazard decision-making — including the ouster of CEO Leo Apotheker 10 months after he was hired — HP said on Thursday that it would hold on to the Personal Systems Group. In the last days of Apotheker’s tenure, the company said that it was considering the sale or spinoff of its PC biz.

Meg Whitman, HP’s new CEO, explained the company’s latest swerve during a conference call with analysts and reporters. “The decision was very straightforward. HP and PSG are better together. It makes strategic, financial and operational sense to retain it,” she said.

Apotheker was once the CEO of SAP, and after taking the reins at HP, he played to his strengths and began shifting the company toward a more software-centric vision. Since his departure, Whitman has taken a hard look at HP’s business, she said, and just five weeks after her appointment, she has changed the company’s course once again.

Under Apotheker, HP not only talked of selling or spinning off the PC division, but also discontinued production of the HP TouchPad, its tablet device powered by webOS, the former Palm operating system the company had acquired less than a year before. The company also raised eyebrows by paying a hefty $10 billion for British “Big Data” analytics firm Autonomy.

Whitman has “taken a more balanced view of how to take HP forward,” Gartner analyst Mark Fabbi told Wired, before referring to previous indications that the company would not sell its PC business. “Given the comments Meg’s made over the last month, no big surprise here.”

Now Whitman and HP will have to show that they can cope with the results of other decisions made during Apotheker’s tenure — without the help of longtime strategy chief Shane Robison.

When asked about the future of webOS, executive vice-president of the PC group Todd Bradley reiterated the company’s commitment to, er, the Windows 8-powered tablet. Whitman said HP would “make a long-term decision about webOS software in the next couple of months.”

The future of Autonomy and its integration with HP was not discussed in detail during the call.

One analyst asked Whitman about how HP’s summer of turmoil would affect its future prospects. “It’s hard to know about the hangover effect of Aug. 18th,” Whitman said, referring to the date of Apotheker’s announcement that the company may sell off the PC business.